Network marketing
Nowadays there are millionaires who earned their money through the Network Marketing System. It is authorized and legal (for four years Amway fought in the courts to prove that MLM was a legitimate business finally winning the case in 1979. This paved the way for many more MLM companies to enter the industry.). Their marketing system is considered to be very similar to the "financial pyramids".
Network marketing is based on product information passed from person to person. A consumer buys goods from a major manufacturer and there are no large intermediaries who conduct bulk purchases, and then sell goods. In addition, in this way, the manufacturer saves on advertising, renting premises for a store or creating an online store.
https://images.app.goo.gl/N65uBhd2RsDDpUmY8
This type of business first appeared in the United States and has been around for over 50 years. Carl Rehnborg [1]was developing nutritional supplements that were made from natural substances and had a large number of vitamins. In order to look at the demand for such a product, the entrepreneur decided to distribute supplements via friends. Rehnborg made friends the first to its distributors: "Give these drugs to their friends, and I'll pay a commission after they buy them"[2]. He called this pattern of sales marketing recommendations. The products were sold rapidly- a huge number of people began to buy nutritional supplements. Friends advised them to their friends, and those to theirs. And thus the world's first network marketing appeared. A feature of the business of Carl Rehnborg was that he received huge profits at almost minimal costs (production of the product itself and packaging).By the end of that year, he established his own food supplement company, opened a research department and launched a network of distributors in regions across the country.
Top 10 Best MLM
companies:
Rank
|
Company
|
Revenue
|
Founded
|
1
|
$8.40 B
|
1959
|
|
2
|
$4.76 B
|
1886
|
|
3
|
$4.90 B
|
1980
|
|
4
|
Infinitus
|
$4.00 B
|
1992
|
5
|
Vorwerk
|
$4.23 B
|
1883
|
6
|
Natura
|
$3.66 B
|
1969
|
7
|
$3.60 B
|
1963
|
|
8
|
Nu Skin
|
$2.40 B
|
1984
|
9
|
Forever Living
|
$2.40 B
|
1978
|
10
|
Coway
|
$2.59 B
|
1989
|
Questions:
Have you ever heard about
network marketing concept? Do you think that it is a pyramid scheme and only
those at the top make a lot of money?
Do you feel like you are a
salesperson, who would be able to recruit networks of salespeople?
What are the advantages and
disadvantages of Network Marketing?
References:
[1] Carl Rehnborg founded The California Vitamin
Company and soon thereafter rebranded it as Nutrilite
Comments
2. First of all, I am not a person who can be persuaded to buy anything easily. Thus, it would be difficult for me to get other people to buy or sell some products. Unfortunately, I have considerable doubts whether most of the products sold in this way are properly tested.
3. The advantages are that you don't have to invest a lot of money in marketing. In addition, individuals can earn little money, not just large marketing corporations. The disadvantages include, above all, the questionable quality of the products and their price can sometimes be exorbitant.
Yes, I've heard about MLMs particulary Avon. Some distant relatives were involved in it. In my opinion it's definitely a pyramid scheme, where you need to recruit new people instead of the company enlarging in effect it's reach and making the company earn more.
2.
I wouldn't like to work as a MLM salesperson, I'm not that good with talking to people and selling them stuff.
3.
I guess that an advantage is that it's work after all and one can earn some pocket money by investing relatively small time into selling products. The disadvantages are that a lot of people are negative towards pyramid schemes and it's harder to sell and recruit people nowadays.
2. I can't imagine myself as a salesman, I am irritated by people who are undecided and constantly change their minds. It exhausts me mentally.
3. The most important advantage is the low cost of marketing. It can be an easy way to start a new business opportunity. Disadvantages include: not many people are able to earn a lot on MLM, usually products are sold to family or friends. Despite the name MLM, unfortunately, if you want to get a higher income, you need to start selling products directly face-to-face.
Yes, it looks like a pyramid scheme. And when such companies lose their popularity those sellers who are at the bottom of the hierarchy find themselves in a difficult financial situation.
2. Definitely not, I don`t feel myself like a salesperson, who would be able to recruit networks of salespeople. I am more an introvert and it sometimes difficult for me to communicate with unknown people and especially sell them products.
3. I think the main advantage to the salespeople is that you can begin working without investment or special requirements. And for companies it is the perfect way to promote themselves without spending a lot of money on marketing and salespoints. The main disadvantages are consumers skepticism to network marketing concept and decline in popularity.
2. Nope. Not at all. I'm not too good when it comes to socialising so it would be one of the worst possible person to choose for such task :)
3. I can think of only few advantages. The biggest would be price as it is simply cheap way to advertise and distribute your product, product availability, because as far as I know, some niche products are sold only in such way and possibility of making small communities of customers. The latter is meant for specialised products where there is narrow group of clients. From disadvantages, it's a pyramid scheme after all. It's enough to resign from getting anything distributed by this way. Unless it's only way to get such product.
I heard that. It's obvious that only those who were first and the owners of this pyramid make money. The problem arises when such a program gets famous, the one that joins it is located at the very bottom of it - and usually you lose more than you gain . The art is to be that high. As far as I know, 10 people should make money for one person. To make such a pyramid happen, you need a lot of naive and greedy friends. Once I let a friend talk me into it and he took me to meet a guy from "magic" level 5. Worst of all, there were about 40 people in the room aged 18-24 and each of them believed in these presentation charts. After they left the room they said they were going to "training" (for which they have to pay, of course) and after that they'll just whack the money. Human stupidity knows no boundaries.
Do you feel like you are a salesperson, who would be able to recruit networks of salespeople?
I know I can't lie to people like that. Technically, you don't sell "profit opportunities". I couldn't sell a dream. A salesman is a rather ungrateful and high-risk profession. You have to guess the customer's intentions very quickly. Otherwise, he can very easily attract criticism.
What are the advantages and disadvantages of Network Marketing?
I don't think there are any advantages. By taking part in such a procedure. You lose friends and reputations. Additionally, after such training you have your brain washed.
I know a lot of examples of network marketing. This method of earning and selling has been propagated around the world for several dozen years. If I remember correctly, Amway was one of the first companies in Poland. The structure of these companies has always been compared to a pyramid and it will certainly remain so.
Yes, I think that only those at the top will earn money and only from those who are at the very bottom. I don't know other results of the pyramid's functioning.
2. Do you feel like you are a salesperson, who would be able to recruit networks of salespeople?
Of course, if you open the sight of easy and quick money to everyone, everyone will decide. Let the starter pack not be too expensive. Otherwise, a broke.
3. What are the advantages and disadvantages of Network Marketing?
Advantages and disadvantages hmm ... The advantage is definitely that you do not need premises, shops, shopping malls is a form of direct sales. The disadvantage is that I don't know anyone who would make reasonable money in this way.
To sum up, think carefully before getting involved in network marketing. I know people who unfortunately went bankrupt due to this type of investment.
2. I don’t see myself as a salesperson.
3. As an advantage there are really low costs of adverts in this model, basing on Avon a few years back all of advertising stuff were handled by the consultants who even could persuade you that you need that particular thing even if you don’t and you would buy lots of things just because someone said that they are really good even if they don’t. As an disadvantage will be a human factor, because first you need to find right person to be a consultant but that’s not all because this person will have to get to as many potential clients as possible because without them there will be no sales and this is the hardest part in my opinion.
I think it's a pyramid scheme. I event has been in one of those, but quickly gave up and didn't earn my Mercedes. :(
Do you feel like you are a salesperson, who would be able to recruit networks of salespeople?
Yes, but I need to believe in my product. Not some garbage cosmetics or mediocre insurance plans.
What are the advantages and disadvantages of Network Marketing?
The advantage is that it's quite easy to get into every company that runs that scheme - which isn't the case with normal companies. The disadvantage is that - at least most of them - is a scam, and they are ripping you, and if you start to make some money only if you start to rip money from other people.
2. No, absolutely not. I couldn't be a salesperson at first place.
3. I cant's think about any advantage - in long term perspective there's more negative things (loosing trust, brain washing, big chances to lose money)
1. Yes, I've heard about the network marketing concept and I think it is a pyramid scheme. I feel that a chance to actually get something with that method if you're not a popular person is close to zero. Only those with many connections and those who invest lots and lots of their time into participating in those types of events will have a low chance of winning.
2. I wouldn't call myself a salesperson, however I am good at managing people and creating teams. I can see myself as a HR worker but I don't think sales are my thing, really.
3. The potential advantage is - of course - an ability to get rich and popular. You can also learn how to sale stuff to others. However, disadvantages of Network Marketing that I can think of are overshadowing the pros. You can easily lose money, time and all of your resources and you can also get scammed easily by companies. There are not many recorded cases of people who actually got somewhere with this method.